Los Angeles County’s massive $4 billion sex abuse settlement has hit a wall, and a Downtown law firm is now at the center of the slowdown. The California State Bar has launched a formal investigation into Downtown LA Law Group, which represents about 2,700 claimants, and county attorneys are asking a judge to let regulators peek behind the curtain at confidential case files. The result: payouts that were supposed to start this month are on ice, and the way the settlement came together is under a very bright, very public spotlight.
County Tries To Open Sealed Files For State Bar Review
In a Jan. 20 motion, Los Angeles County lawyers asked Superior Court Judge Lawrence Riff for permission to share sealed filings involving Downtown LA Law Group with State Bar investigators, according to the Los Angeles Times. County attorneys said the bar needs the material to probe allegations that some plaintiffs did not simply come forward, but were steered into lawsuits by outside recruiters. The motion asks the court to hold a hearing on Feb. 26 to decide whether the bar can review those records.
What The State Bar Is After
The State Bar served a subpoena on Nov. 4 that demanded three sets of documents: the lawsuits themselves, detailed narratives of the alleged abuse and mental-health certificates for older claimants, according to the county’s filing posted on DocumentCloud. County lawyers say they already turned over the lawsuits. The other materials are locked behind a protective order, which means they cannot be released without a judge’s signoff.
In that motion, the county flagged accusations that outside “third-party recruiters” may have funneled people into the litigation, and warned that some filings could be misleading or rise to the level of moral turpitude. That is the kind of language that tends to get bar investigators’ attention.
Thousands Of Claims, Big Money And A Big Delay
Downtown LA Law Group represents about 2,700 claimants, nearly one quarter of everyone included in the settlement, according to the Los Angeles Times. Individual awards are expected to range from roughly $150,000 up to $3 million.
Checks that were supposed to start going out in January are now on hold while the county takes a closer look at the firm’s caseload. To add another layer of scrutiny, officials have brought in a retired judge whose job is to review Downtown LA Law Group files before any money is released.
Firm Pushes Back On Referral Allegations
Downtown LA Law Group has publicly denied that it pays anyone to bring in clients and says it does not compensate third parties for referrals, according to the Downtown LA Law Group. The firm also highlights what it describes as internal screening procedures that are supposed to weed out cases that do not meet its criteria.
What Is At Stake With The Bar Investigation
If investigators find that attorneys or their agents paid people to file claims, those lawyers could face discipline under California law. The State Bar Act prohibits paid solicitation and the use of so-called “runners” or “cappers,” according to the State Bar. The bar can subpoena records and impose penalties that range from public reprovals to full-blown disbarment.
Criminal Probe And County Crackdown
The ethics inquiry is unfolding alongside a criminal review by the Los Angeles County district attorney’s office, which is examining claims that some plaintiffs were paid to sue. District Attorney Nathan Hochman has said his team will focus on lawyers, recruiters and medical providers who may have played a role in any fraud, according to the AP.
County officials, meanwhile, have set up extra vetting procedures and a tips hotline and are warning that any fraudulent claims will be tossed before dollars go out the door. They also note that the sheer size of the settlement will strain county finances for years, which is one more reason they say they are keeping the brakes on until they are confident the claims are legitimate.
Next Up: A Key February Court Hearing
All eyes now turn to the Feb. 26 hearing, when Judge Riff is expected to decide whether the State Bar can get access to the sealed records, according to the county’s motion on DocumentCloud. If the request is granted, bar investigators would gain access to more detailed abuse summaries and mental-health certificates that county lawyers argue are essential to assessing whether each claim holds up.
Until the court rules on that question, thousands of alleged victims will be stuck waiting, and the law firm at the center of the storm will remain under an uncomfortable spotlight.
